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adding picture causes System.OutOfMemoryException

There seem to be several issues when trying to add a transparent PNG logo to a crystal report. Firstly if you add a small sized logo, around 200kb, the report will increase in size to around 10mb. Apparently it saves the image as bitmap. I can't save the
original as bitmap because transparency is lost. I need transparency to have text printing on top of the image.

Another technique is to override the Picture > Graphic Location. This works in the sense that the image can be changed at runtime and a very small image can be stored in the report, but after a few iterations the application still runs out of memory.

What is the workaround for my requirement - transparent PNG not running out of memory?